1. Why do companies invest in other companies?

2. Describe the classifications used for investment in debt and equity securities according to current U.S. GAAP.

3. What should be included in cost when acquiring debt and equity securities?

4. How should the purchase of accrued interest be recorded? What formula is used to calculate the amount?

5. How should the receipt of interest be reported for TS purchased at a discount? Purchased at a premium?

6. How should the receipt of interest be reported for AFSS purchased at a discount? Purchased at a premium?

7. How should the receipt of interest be reported for HTMS purchased at a discount? Purchased at a premium?

8. How should the receipt of dividends be reported for TS and AFSS?

9. How should the receipt of dividends be reported for EMS?

10. When is the change in fair value of investments generally considered?

11. How should the change in fair value of investments be reported for TS, AFSS, HTMS, and EMS on the balance sheet?

12. How should the change in fair value of investments be reported for TS, AFSS, HTMS, and EMS on the income statement? On the comprehensive income statement?

13. How do you calculate gain/loss on sale of TS, AFSS, HTMS, and EMS?

14. When should impairment losses be reported?